The Association of Directors of Adult Social Services (ADASS) routinely joins calls for much greater levels of funding so the people they serve can have the lives right for them. They berate political leaders for failing to provide more. But, curiously, Directors always get the budgets they tell their local political leaders they require to ensure no need is ever left unmet.
Their actions directly contradict and undermine their words.
This is how it happens.
The 2014 Care Act is clear. Councils should identify all needs that call for public resources without regard to the available resource. They should look at all needs that impact the 9 areas of wellbeing set out in the act. Some of the needs they identify they are legally obliged to meet regardless of the cost. These should be no more than a guaranteed minimum. Councils then have a statutory power to meet all other needs. For these needs, they can take their resources into account. This allows transparency about which needs they have the resources to meet and which they do not. This is essential information for subsequent budget setting. The Care Act requires councils to ensure there are sufficient resources to meet all needs for people to have the lives right for them.
But this is not what councils do. Instead of the legal duty to meet need being a minimum, they make it the total offer. They say these are the needs (called ‘eligible’) that people require from public funding to make their lives as they should be. The power to meet need is superfluous. It is disregarded and, other than in occasional emergency situations before needs can be assessed, never used for ongoing needs.
Operational staff must calibrate what they consider ‘need’ to whatever their budget happens to be. All other claims for need – whether by service users, their families or advocates – must be dismissed as non-needs.
Making all needs a legal duty to meet gives Directors a unique power. It obliges their council to provide the budget to meet all these needs or face legal jeopardy. It’s a tool Directors can wield to outmaneuver competitors for the limited public funds available.
Budgets are set on an incremental basis. This year’s budget can be set on the basis that last year’s was sufficient to meet all legal obligations. An amount can then be added for increased demand, primarily resulting from demographic growth.
A fatal flaw
There is just one snag. Its a snag that makes for a fatal flaw.
For the strategy to work it assumes that at least one year in the past budgets have been based on how much money is actually sufficient to meet all needs. In subsequent years, so long as the incremental changes are correctly costed, the correct level of funding will be maintained. It's what economists call ‘zero based budgeting’.
But budgets have never been zero based.
Neither central nor any local government has even attempted it. Not least because it is arithmetically impossible. Needs for care and support are unique to each individual. The costs of meeting needs are hugely variable. Knowing in advance how much it will cost to enable any individual to secure their well-being, let alone a whole community of individuals, with the accuracy required for budget setting is mission impossible.
This creates a serious problem. Directors put their operational staff – the social workers who identify need and the managers who allocate resources - in an untenable position.
They are legally obliged to meet every need they identify that calls for public funding without regard to the cost. At the same time they must spend within whatever budget they happen to have been given.
There can be only one resolution. Operational staff must calibrate what they consider ‘need’ to whatever their budget happens to be. All other claims for need – whether by service users, their families or advocates – must be dismissed as non-needs.
A vicious circle is established. This year’s budget is based on last year’s being sufficient to meet all need, which was only the case because ‘need’ was calibrated to last year’s budget. This was the case for last year’s budget, the one before that and the one before that and so on and so on back through time. Funding is trapped at historic levels.
The net effect is that a bad situation in 2010 has got slowly but progressively worse. This is manifesting itself in the sight of councils employing a range of penny pinching strategies to reduce spending.
The evidence in action - the ADASS Annual Budget Survey
Every Spring, ADASS produces an annual survey of Directors. Knowingly or not, it provides the evidence that shows this is how the system actually works.
In the five years from 2019/20 to 2023/24, net budgets amounted to £84.1BN; net spend was £84.9BN. An overspend of less than 1% will not cause any concern for the Chancellor or local Finance Director, not least from a service seen to be so financially volatile and high risk, as is the case with social care. As a strategy to ensure spending is to budget, it works.
The only mention of any needs being unmet by ADASS is in the context of people waiting for their assessment. There is no such thing as an unmet need once a person has undergone an assessment and their needs have been identified. Politicians can rest assured they are already providing sufficient to meet all needs, whatever noises off stage, even from ADASS.
Every year, councils accept the need to increase budgets to allow for demographic growth, because there will be more needs that are a legal obligation to meet. They have no choice but to accommodate these needs. For the current year, Directors told councils the increases required would amount to £801M between them. This is about 4% of this year’s £20.5BN net budget.
However, Directors then tell their councils they don’t actually need to increase their budgets. This is because they will release sufficient money through ‘efficiency savings’. These allow cuts to budgets on the basis they deliver the same, or even improved, outcomes but for less money. Budgets can be safely cut. In the case of social care, Directors tell their councils these savings will come primarily through improved practices. These new practices called 'strengths-based' will build on the strengths of individuals and the assets of communities. It is a strategy that assumes existing practices do neither.
This year the efficiency savings promised by Directors to their councils amounted to £903M, which is 4.4% of the budget.
In the past five years, Directors have reported cumulative savings of £3.5bn, and for the previous decade no less than £7.7bn. This is more than enough to compensate for any growth in needs from demographic change.
The net long term effect
The Institute of Fiscal Studies notes that real terms spend per adult population in 2022/23 was identical to the spend in 2009/10 (although if adjusted for the fact the older population has grown more rapidly than the working age population, that won’t be the case fully until 2024/25).
ADASS may well claim this standstill position to be a success. Whilst they have seen fellow local authority services ravaged by austerity, social care spending has been protected.
However, against that must be the following two considerations;
1. The 2010 budget was never an appropriate ‘base’ from which to start. Representative groups and advocates at the time reported large swathes of needs unmet. Think tanks put the figure at about £7BN, needing a 50% increase in funding. Regardless the credibility of these estimates, they are a measure of the scale of concern experienced throughout civil society.
2. The efficiency savings required to pay for demographic change cannot, and have not, actually happened. The practice changes they rely on are made impossible by the very practices the system imposes on staff.
A cursory examination of events make it plain that the efficiencies could not have occurred. The suggestion that a one-time transformative event happens in a never-ending cycle year after year in some kind of Groundhog Day of perpetual repetition stretches credulity. The lack of challenge from councils toward their Directors' implausible money-saving plans, shows their indifference to whether or not they happen. They allow local political leaders to escape the responsibility of finding funds to address the growing needs they accept they are legally required to meet.
An ambition limited to preserving the 2010 funding levels is institutionalising insufficiency
The net effect is that a bad situation in 2010 has got progressively worse. This is manifesting itself in the sight of councils employing a range of penny pinching strategies to reduce spending. These include;
increasing charges with two effects. The first is to reduce demand by excluding more people as they fail the means test. The second is to secure more income from people who cannot escape the system. Councils do so with little regard to the financial hardship caused to those people.
re-classifying needs for wellbeing for which they have previously accepted responsibility as mere ‘preferences’ through what councils call ‘fair and affordable’ policies. The re-classification means they have removed their responsibility to meet these needs.
aggressive pricing of commissioned services occurs without considering the impact on providers. This leaves providers unable to resource their services adequately to meet the needs of their users.
Summary
Social care’s leaders are architects of their own predicament.
It may be they are meekly delivering the covert wishes of successive governments. This is a system that keeps spending to the available budgets by disappearing any needs for which there is no resource. This approach, though short-sighted and unjust, serves immediate political goals. We explore this more fully in our dossier Social Care Exposed due to be published.
It may also be that social care’s leaders genuinely believe what they are doing is the best that can be done for the people they serve. Rooted in a view that society does not care about older and disabled people and, given the choice, would not spend public money on their wellbeing, they believe society must be forced to do so.
But they must weigh that against it requiring a strategy that results in social care being trapped at historic levels of funding, with no prospect of ever achieving sufficiency. They must also accept it requires practices that result in the most inefficient use of public money. Insofar as these are both true, they need to reflect on whether, knowingly or otherwise, they are truly serving the interests of older and disabled people.
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